Wyndham Hotels & Resorts, Inc.

Please stand by, we're about to begin. Welcome to the Wyndham Hotels and Resorts first quarter 2024 earnings conference call. At this time, all participants have been placed on a listen-only mode and the floor will be open for your questions following the presentation. If you would like to ask a question at that time, please press star 1 on your telephone keypad. If at any point your question has been answered, you may remove yourself from the queue by pressing star 2. Lastly, if you should require operator assistance, please press star 1. I would now like to turn the call over to Mr. Matt Capuzzi, Senior Vice President of Investor Relations. Please go ahead, sir.

Thank you, operator. Good morning, and thank you for joining us. With me today are Jeff Vellotti, our CEO, and Michelle Allen, our CFO and Head of Strategy. Before we get started, I want to remind you that our remarks today will contain forward-looking statements. These statements are subject to risk factors that may cause our actual results to differ materially from those expressed or implied. These risk factors are discussed in detail in our most recent annual report on Form 10-K filed with the Securities and Exchange Commission and any subsequent reports filed with the SEC. We'll also be referring to a number of non-GAAP measures, corresponding GAAP measures and a reconciliation of non-GAAP measures to GAAP metrics are provided in our earnings release, which is available on our investor relations website at investor.windomhotels.com. We are providing certain measures discussing future impact on a non-GAAP basis only because without unreasonable efforts, we are unable to provide the comparable GAAP metric. In addition, last evening, we posted an investor presentation containing supplemental information on our investor relations website. We may continue to provide supplemental information on our website and on our social media channels in the future. Accordingly, we encourage our investors to monitor our website and our social media channels in addition to our press releases, filing submitted with the SEC, and any public conference calls or webcasts. With that, I will turn the call over to Jeff.

Thanks, Matt, and thanks, everyone, for joining us this morning. Despite a challenging RevPAR environment here in the United States, we're pleased to report another strong quarter of progress on our executions, openings, retention, and net room growth around the world. In addition, late last week, our board increased our share repurchase authorization by $400 million, demonstrating its confidence in our ability to generate significant cash flow and its commitment to continued shareholder returns in the year ahead. We opened over 13,000 rooms globally, 27% more rooms than we opened last year, our largest first quarter of room openings since going public nearly six years ago. We increased our franchisee retention rate by 30 basis points versus the same time last year to 95.6%. We delivered a record 3.7% increase in net room growth. And most importantly, for the 15th consecutive quarter, We grew our development pipeline by 8% to a record 243,000 rooms. Here in the United States, we again saw both sequential and year-on-year improvement driven by 3.3% system growth and a more revenue-intense mid-scale and above segments. We added 50 hotels domestically, including 11 hotel conversions under the newly created WaterWalk Extended Stay by Wyndham Brand. Located in key markets such as Charlotte, Raleigh, Tucson, and Jacksonville, Water Walk by Wyndham adds higher fee-par hotels to our system while expanding our portfolio into the upscale Extended Stay segment, complementing our new construction Echo Suites and mid-scale Hawthorne Suites Extended Stay brands. Internationally, we increased net rooms by 1% sequentially and by 8% versus prior year. Our Latin America team drove over 2% of sequential net room growth and 6% of net room growth versus prior year, adding significant conversions from competitive brands like the 600-room Wyndham San Paolo Convention Center Hotel in the financial capital of Brazil, along with a new trip by Wyndham Asuncion steps from the renowned shopping centers of Paraguay's capital city. Our EMEA team, which added 49% more rooms to its development pipeline than they did in the first quarter of 2023, once again grew net room sequentially and by 12% versus prior year, adding aspirational hotels like the Ramada Sapaka Thermal Resort in Turkey and the new trademarked by Wyndham H2 Hotel in downtown Vienna, Austria. Last month, I had the opportunity to visit with our teams in Singapore and Shanghai, and joined the signing ceremonies for 27 of the over 60 hotel contracts awarded to owners this quarter across Asia Pacific. Our Southeast Asia and Pacific Rim region, which increased rooms by 2% sequentially and by 16% versus last year, entered several new markets, including Pattaya, a growing leisure destination in Thailand. In January, we opened the Wyndham Jantian, an upscale new construction hotel and the first of another eight hotels we expect to open in the Pattaya market over the next five years. And our direct franchising team in China, which grew net rooms 1% sequentially and by 13% versus prior year, also had another strong quarter of openings and executions, awarding 38 new contracts to owners, over three times what they awarded last year in the first quarter and opening new construction and conversion hotels across the country, like the Wyndham Dalian Jinpu, an upper upscale five-star hotel in the city center of Hainan province. Globally, our teams awarded 171 contracts for approximately 24,000 room additions. Domestic contracts signed in the first quarter were 50% higher than last year for our mid-scale and above segments. and international Q1 signings increased by 80% year over year. This acceleration of our development activity grew our pipeline to a record 243,000 rooms and nearly 2,000 hotels. Mid-scale and above brands in the pipeline increased 4% to a record 168,000 rooms and now represent nearly 70% of our pipeline. Our domestic pipeline for mid-scale and above brands increased by 4%. And the pipeline for our highest international REVPAR regions of India and Latin America increased by 21%. In the toughest quarterly comp we will face all year, domestic REVPAR finished down 5% compared with 2023. Domestic occupancy finished at 90% of 2019 levels, down 440 basis points from Q1 of 2023, while pricing power remained strong, with ADRs 14% higher than pre-COVID levels, yet still trailing inflation, which has increased 23% over this same period. REVPAR improved 240 basis points from February into March and accelerated into April. Month to date through the 20th of April, domestic REVPAR ran 4% ahead of prior year, benefiting from both the Easter shift to Q1 and weekend demand around the solar eclipse on April 8th. And May revenue on the books is pacing 7% higher than it was at the same time last year. International RevPAR increased 14% to prior year in constant currency, driven by strength in Latin America, where RevPAR increased by 41%, and across EMEA, where RevPAR increased by over 10%. And in China, which continues to face deflationary pressures, RevPAR also increased by over 10% year over year, driven by both ADR and occupancy, outpacing STR China Red Park growth by 700 basis points. Ancillary revenues increased 8% during the first quarter, driven by success from our Blue Thread licensing agreement with Travel and Leisure Group, along with several new product offerings like our paid $95 Wyndham Rewards earner business card. which has garnered acclaim as Forbes' best business card for road warriors thanks to its automatic diamond status and its ability to earn a best-in-class eight points for every $1 spent on hotel stays and gas purchases. And last week, we launched Wyndham Business to streamline the direct booking process for business of all types and all sizes, along with travel planners who are contracting hotel nights for our nation's 15 million infrastructure workers across the United States of America, offering these planners a comprehensive suite of free tools that guarantee their companies a minimum 10% room discount, easy direct billing and instant group bookings with tailored Wyndham Rewards business to ensure a smooth travel planning process with personalized support from dedicated sales professionals. We anticipate that Wyndham business will not only drive additional bookings to our select service hotels, It will also drive additional membership to Wyndham Rewards USA Today's number one loyalty program for six years running, along with additional cardholders to our suite of co-branded credit card products, providing us a new channel for ancillary fee growth. We're currently offering four distinct credit card products tied to Wyndham Rewards in the US, and we see significant opportunities to expand these products globally as Wyndham Rewards continues to grow in importance both domestically and internationally, up over 40% since 2019 and up 7% year over year to 108 million members strong. Finally, we'd like to thank our franchisees and team members for their unwavering commitment and support over the past months throughout Choices' failed takeover attempt of our company. Through it all, it was no surprise to see Wyndham Hotels and Resorts selected by Newsweek as one of the 2024 most trustworthy companies in America and as a four-time honoree as one of the 2024 world's most ethical companies by Ethisphere. On behalf of our board, we also want to thank our shareholders for their overwhelming support. We're confident in our growth strategy and in our ability to create substantial value both in the short term and in the long term. And with that, I'll now turn the call over to Michelle. Michelle?